Dan From TheChartGuys Insights on Cannabis Stock Market
The TDR Three Key Takeaways regarding Dan, TheChartGuys, and Cannabis Stock Market:
- Dan McDermitt observes a persistent bearish trend in the cannabis stock market.
- Liquidity challenges make the cannabis market unpredictable, says Dan McDermitt.
- Strategic timing and patience are vital for cannabis investors, Dan McDermitt notes.
On last Friday’s episode of the “Trade to Black” podcast, Dan McDermitt from TheChartGuys provided a comprehensive analysis of the current state of the cannabis stock market. Dan McDermitt emphasized that the cannabis market continues to experience a slow grind downward, with no significant bullish shifts. “We’re not seeing anything that is telling us anything is shifting at the moment,” Dan noted, pointing out the consistent formation of daily lower highs across various stocks. This indicates a strong bearish control, making it a challenging environment for bullish investors.
Focusing on Canopy Growth Corporation (NASDAQ: CGC, TSX: WEED), Dan highlighted the formation of a bear flag pattern. After a brief bounce to a resistance level of $7.85, CGC dropped to new lows. “$6.09 is the next major level that we’re looking at on CGC,” he mentioned, noting that the stock has been on a five-week decline with no solid green days. The continuous setting of daily lower highs underscores the bearish dominance in the cannabis stock market.
For those still holding positions, Dan advised against selling amid the current fear and weakness. He stressed the importance of strategic positioning ahead of potential catalysts, such as the upcoming vote in Florida, which he believes could significantly impact the market. “A lot of hope is riding on the Florida vote,” Dan remarked, indicating that a favorable outcome could offer a much-needed boost to the sector.
Dan also touched on liquidity issues, noting the low trading volumes and the absence of bullish activity. “With so little liquidity, finding bid support is challenging,” he said. This lack of liquidity contributes to the volatility and unpredictability of the market, making it difficult for investors to navigate.
Discussing High Tide Inc. (NASDAQ: HITI, TSXV: HITI), Dan identified $2.20 as a critical support level. “If we do break that $2.20 low, then the next most important level for me is $1.92,” he added. Monitoring these support levels is crucial for investors to make informed decisions and anticipate potential cannabis stock market movements.
Dan compared the performance of various ETFs, including MSOS and YOLO. He pointed out the similarities in their price action, with both exhibiting potential bear flags. “$6.88 is the current lowest price that we’ve seen for MSOS,” Dan highlighted, stressing the importance of watching these levels closely.
For investors seeking entry points, Dan advised patience and caution. He shared his approach of making protective entries and exits based on cannabis stock market signals. “If we get this bear flag confirming and another leg down, I’m just going to hop right back out again,” Dan explained, illustrating the need for flexibility and responsiveness in trading.
Looking ahead, Dan mentioned the potential impact of upcoming events and seasonal trends. He underscored the importance of staying informed about market developments, such as the Florida vote and changes in regulatory policies. “Take it one day at a time and be very patient before looking to get back in the sector,” he concluded.
By focusing on key support and resistance levels, understanding liquidity challenges, and being strategic in timing investments, market participants can better manage their positions and anticipate potential shifts in the cannabis stock market. Want to be updated on Cannabis, AI, Small Cap, and Crypto? Subscribe to our Daily Baked in Newsletter!
